ETX Capital Daily Market Bite, 16th May, 2013: European Stocks Ease; US Data Eyed
May 16, 2013 11:08 am
May 16th 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
European stock markets are broadly flat Thursday morning, taking a breather after pouring on gains in the face of poor data from the euro zone and the US in the previous session. Euro zone Q1 GDP, US industrial output and Empire State manufacturing data releases all fell short of expectations but the bulls continued to drive the market higher on expectations that central banks will continue providing stimulus. Though reports and comments by Fed members suggest the central bank is looking for an exit strategy, weak economic data would prevent an imminent tapering of stimulus. For Europe, traders believe that the prolonged recession leaves the ECB little choice but to look into its toolbox to employ additional stimulus measures, ranging from further rate cuts, negative deposit rates and buying ABS.
Overnight on Wall Street, the DJIA again printed fresh highs while the S&P500 reached an intra-day peak of 1662 during the session. In Asia, Japan’s new PM Abe’s economic framework, “Abenomics”, appears to be working after Q1 GDP rose 3.5% on an annualized bases. The country’s economic growth outperformed its industrialized peers during the period and the reading gives a strong signal to the BOJ to continue aggressively adding stimulus. Attention this session will centre around euro zone trade balance and harmonized inflation data while in the US, we have readings on housing starts, consumer price inflation and weekly jobless claims. We also have a reading from the Philly Fed.
May 16th 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
European stock markets are broadly flat Thursday morning, taking a breather after pouring on gains in the face of poor data from the euro zone and the US in the previous session. Euro zone Q1 GDP, US industrial output and Empire State manufacturing data releases all fell short of expectations but the bulls continued to drive the market higher on expectations that central banks will continue providing stimulus. Though reports and comments by Fed members suggest the central bank is looking for an exit strategy, weak economic data would prevent an imminent tapering of stimulus. For Europe, traders believe that the prolonged recession leaves the ECB little choice but to look into its toolbox to employ additional stimulus measures, ranging from further rate cuts, negative deposit rates and buying ABS.
Overnight on Wall Street, the DJIA again printed fresh highs while the S&P500 reached an intra-day peak of 1662 during the session. In Asia, Japan’s new PM Abe’s economic framework, “Abenomics”, appears to be working after Q1 GDP rose 3.5% on an annualized bases. The country’s economic growth outperformed its industrialized peers during the period and the reading gives a strong signal to the BOJ to continue aggressively adding stimulus. Attention this session will centre around euro zone trade balance and harmonized inflation data while in the US, we have readings on housing starts, consumer price inflation and weekly jobless claims. We also have a reading from the Philly Fed.
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